Fed chairman offers no plan for new stimulus

“With respect to longer-run prospects,however,my own view is more optimistic,” Bernanke said in his prepared remarks. “The growth fundamentals of the United States do not appear to have been permanently altered by the shocks of the past four years.”

Bernanke was careful to note that the nation faces significant challenges,including high unemployment and an unsustainable federal debt. But the speech,delivered at a policy conference held each August in Grand Teton National Park,marked a return to the Fed’s position earlier this year that the Fed has done most of what it can,and that the rest of the government must do more.

Indeed,Bernanke devoted much of his speech to fiscal policy,rather than the monetary policy that is the Fed’s primary responsibility. And he offered an unusual critique of the government’s handling of those issues.

“The country would be well-served by a better process for making fiscal decisions,” he said,noting that the political battle over raising the debt-ceiling had disrupted the financial markets “and probably the economy as well.”

Bernanke suggested a different process,involving “clear and transparent budget goals,together with budget mechanisms to establish the credibility of these goals.”